Built to cost – Interview of Carillion CIO’s modernisation cycle

Richard Gifford is one of that rare breed of CIOs who’s been a managing director. He led the Kent and Medway NHS Informatics Service for just over two years, but he’s back with a different hat as CIO for the Construction Services division of multinational building and construction services company, Carillion.

Working as an MD was professionally fruitful, but it’s being a CIO with a remit to drive change in commercial environments that powers Gifford.

Carillion is listed on the London Stock Exchange and is a major player in the construction and building support services industry, with a building remit that includes key public sector areas such as hospitals.

Construction still plays a significant part in its business model – like many of its peer organisations, the company has diversified to give itself a more stable platform of operations, which is important in the hectic quarterly reporting cycle of a listed company.

The Carillion brand only came into being in 1999, following a demerger with Tarmac, the company known for its road building materials. Since then, Carillion has acquired several major construction and service-management organisations – including Mowlem in 2006, Alfred McAlpine in 2008 and energy services specialist Eaga in 2011.

“It’s fast-paced and quite diversified in terms of operations and services,” Gifford says of the organisation that’s been his employer for the past year.

“This industry is very cost-based and Carillion is doing well. And we can get our operating cost more competitive,” he says of the renewed interest in how technology can benefit the company.

“My remit is that there are no broken services, but there’s a feeling that there’s a lot more that can be done – and we can use IT to do more and pull more levers.

“Eighty per cent of our IT cost base was run cost. We’re reducing that to 50% and we’ve made a pretty good start by focusing on the key costs and the key technologies that we could update.

“A key area on the supply side is – how do we liberate the money with our outsourcing agreements and transform our services? We’ve done a lot of work in the outsourcing area and a lot of my time has gone into that,” Gifford explains.

“There’s a lot of ambition in Carillion to extend its services as part of our go to market, so we need to partner with our outsource providers to work on that service offering.”

Wipro took over responsibility for the Carillion IT operations on 1 March 2014, and will manage 80% of the IT staff within Carillion. It will replace Accenture as the primary technology and business process outsourcing (BPO) supplier to Carillion. Gifford tells us that Wipro will supply 100% of the IT in use at Carillion.

“What we are keeping within Carillion is the roles that are engaged with the business and strategic delivery,” explains Gifford.

“We have contracted for innovation and there is a real opportunity for transformation in the business,” he says, adding that Carillion expects major advances in the use of analytics and mobility from the deal.

“We are going to transform the IT, so that IT is the go-to place within Carillion for business transformation.

“By getting the run costs down, we can use the money saved for the transformation. You want people focused on their jobs, not battling with technology. The senior management team really understand that. Our leaders recognise the power that this technology has and that the people coming into the organisation expect and, if we don’t engage with that, then managing the talent becomes very difficult.

“But the transformation has to be self?funding. It’s a fantastic challenge and a very realistic and honest way of doing things.” Gifford has had to reduce his £60 million budget by 25%, yet deliver more.

Stage one of the transformation has been a software upgrade with the implementation of Microsoft Windows 7, and there are plans to move to Windows 8.1. “There was a desktop refresh going through the business when I arrived. The Windows 8.1 deployment is hot on the heels of Windows 7 to allow the use of tablet devices,” he explains. Office 365 is also being introduced, initially for email to enable greater mobility.

Carillion had also started the introduction of the Microsoft Lync collaboration tool, which has now been installed across the business.

“Lync has the ability to transform what we do. We have people spread out all over the place and, increasingly, parts of our team are coming together as we are a project-based firm. Lync will support that culture, and enable home working and reduce our travel costs,” he says.

Mobility is one of the major building blocks of Carillion’s transformation plans. “I want less returning to base,” he says. “In our head office there’s a huge number of meetings taking place all the time. Lync and IM mean you can congregate around specific topics – not necessarily in the same room.”

With tablets and Windows 8 entering the organisation, inevitably Carillion is looking at how certain kinds of apps can benefit users and the organisation.

“Health and safety is the number one priority. At the moment, we use cards to report incidents on sites or in the offices we operate, whether it’s a trip hazard or some dodgy scaffolding.

“With mobile we’re giving people the app to do some reporting, so we can look at feedback and streamline our processes to improve business performance.

“We have several apps in development as there’s a great desire by the organisation to move forward. The Don’t Walk By app is seen as key,” Gifford says.

He is already rolling out tablets in the Construction Services division he’s CIO for, but only where they’re needed.

“It’s because the users need them for their role, so we’re giving them a tablet for a specific application. Our engineering business has a primary application for their job on a tablet, which means they’ve stopped filling out forms or spreadsheets.

“We’re very strongly questioning the cost of tablet ownership and the services it provides our engineers and we have to be precise about this because of the margins in this business.” Tight margins in construction are still a reality.

“Because we’re aiming for horses for courses with devices, that means Microsoft is a good solution for us,” he says of the adoption of Windows 8.

Carillion has its financial and HR built on the Oracle platform, which Gifford describes as excellent (“although it comes at a price”) and with email having already gone up into the cloud, Gifford’s confident more IT operations will become cloud-based at Carillion. “We’re examining infrastructure-as-a-service and software-as-a-service and looking closely at the agility and costs,” he explains.

Management direction

The degree of stakeholder management in the NHS, making sure that everyone was bought into plans so that every business unit has buy in, is the key lesson that Gifford has taken from his time as a CIO and MD in the NHS. He says it’s a useful skill set in a large and diverse organisation like Carillion.

“The MD role was great, but this is far more transformative. Everything we do here has a deep financial impact and I thrive in a commercial environment. To make a difference was the challenge I was after,” he says of the role change.

Before joining the NHS in 2008, Gifford was IT Director for Rok, a one?time rival to Carillion in the building services market. Today Rok is just another name in the history books of the global economic downturn.

“Rok had real ambition and that was a great journey to be on as it had a startup ethos,” he says of his five years there. “Carillion is a far more mature organisation, but has an entrepreneurship culture for new markets.”

To reflect the increasing mobility Carillion is aiming to introduce to the organisation, Gifford has no permanent office. We meet at the London office that’s set up for roaming workers, while he’ll regularly spend time at Carillion’s Wolverhampton nerve centre as well as many other company locations.

That roaming working lifestyle means Gifford takes his training as a top-level cycling time triallist with him.

“I have my bike and turbo trainer in the boot of the car and I get up at 5am to train before work,” he says of his commitments to the In-Gear QuickVit team that has bona fide cycling legends Sean Yates and Michael Hutchinson on its roster. He’s in esteemed company.